O&M service contracts 101: how to choose an O&M service provider

We’ve spoken previously about the value of obtaining O&M services for solar systems on commercial and industrial property. O&M is a key way of ensuring that solar plants perform optimally, reducing energy system downtime. Choosing the correct O&M service partner  will help to provide essential services and personnel for the ongoing operation of the solar PV plant. As such, it’s important to choose the right service partner who will make sure the system is running smoothly, maintained regularly, and monitored remotely to ensure that the expected financial savings are secured.

Why is appointing an O&M service partner important?

Financial: appointing an O&M service partner means that the financial returns of the system can be secured. The earlier that any issues within the solar system can be discovered, the quicker they can be resolved, reducing downtime and associated costs.

Safety: having an O&M service partner in place can ensure that safety hazards, such as fire and electrocution hazards, are avoided in advance. An O&M service partner should be able to see real-time system production and coordinate routine maintenance visits that will be able to prevent a host of safety hazards.

Component longevity: having an O&M strategy is also a good way to keep track of each component within a solar PV system. This becomes important as the system ages, as different components will have different warranties and replacement costs.

How to choose an O&M service partner

There are several points to consider when deciding on this. For example, does the service provider commit to performance guarantees, and what is their mechanism for ensuring your plant’s performance? In order to ensure service delivery, a performance guarantee will provide peace of mind that if the system underperforms, financial compensation will be provided.

Other points to consider include making sure that the promised Maintenance Schedule is comprehensive and can be adapted to the specific solar PV system. If your solar PV system is on a rooftop in an industrial area, for example, it may require more frequent cleaning; or if it is a carport structure, it might require other checks relevant to the structure. It’s important that the O&M partner understands these nuances.

Other important components of the O&M service are reporting tools and software. Having great maintenance but no way of accessing relevant reports, for example, would affect the overall value of the O&M service provided. Feel free to ask for a demonstration of the software, or an example of the monthly report that you will receive when you sign on with an O&M service partner, in order to understand if their methods of reporting are relevant to your system.

Do you know the warranty length and conditions for each of the different solar system components? Ensuring that your O&M provider is experienced in managing warranty claims, replacement of equipment, and arranging of logistics for repairs or replacements of components will be key to saving you money and reducing downtime. Understanding which components are under specific warranties will ensure cost savings, should they need to be replaced.  

What is included and excluded from a typical O&M contract

Once a relevant O&M service partner is chosen, it is important to sign an O&M service contract to ensure that both parties fulfil their duties on a regular basis. This is an essential component that will ensure that the system is maintained with consequences for the service partner, should they not provide adequate, timely services. It will also protect the performance guarantee of the solar PV system, ensuring that should the system underperform, the business will be financially compensated.

Make sure the contract includes the following clauses:

• Duties of contractor
  • What exactly will the O&M service partner provide on a monthly, quarterly, bi annual and annual basis? What is excluded?
• Liability and termination
  • Who is liable for various scenarios? When should the contract be terminated and under what circumstances?
• Breach of contract clause
  • What constitutes a breach of contract for either party, and is there provision for relevant penalties?
• Governance of relationship between employer and contractor
  • How will the relationship between yourself and the O&M partnership be governed and altered in the future, if necessary?
• Site-specific details
  • Things such as the site performance guarantee, when payment should take place, the specifications of the solar plant and the outline of maintenance specific to the site should be detailed
• Reasonable inclusion
  • What is reasonable to include in the contract, and what is not included in the contract?

Choosing the best O&M service partner and making sure that the contract governs a trusting, accountable relationship is an essential part of solar PV system ownership and management. If you would like a comprehensive guide to O&M strategy, download our free ebook.